Project of the Week: New Found Gold Queensway Gold Project, Newfoundland

30th June 2021

 

Happy Wednesday readers! This week I am once again bringing you a standout junior mining prospect, and this time we are heading west (for me) to virtually visit New Found Gold’s Queensway Project in Newfoundland, Canada. We are focussing on two of the most eye-catching areas of this project: the Keats and Lotto discoveries. New Found believe they have a large epizonal sedimentary-hosted orogenic gold deposit on their hands and have compared it to Kirkland lake’s Fosterville high-grade zone, only this one isn’t 800m below the surface!

New Found Gold acquired the Queensway properties at the bottom of the last gold cycle in 2015 and have been consolidating licences along the Central Newfoundland Gold Belt. August 2020 saw the commencement of a 100,000 m drill program across the entire Queensway project and approval for drilling of the Keats prospect came just four weeks later. It is the results from this area that initially drew my attention to New Found Gold as frankly they have been very impressive; multiple 10m+ drill hole intersections above 100 g/t impressive.

Simplified geological map of the Queensway project.
Figure 1. Simplified geological map of the Queensway project.

The island of Newfoundland forms the northern part of the Appalachian orogen and is divided east to west into four terranes, which are the products of several rifting and collisional events spanning ~400 million years.

The Queensway project geology is primary composed of  Early to Middle Palaeozoic deep marine sediments which overly the Gander River Ultramafic complex, containing discontinuous slivers of an ophiolite sequence from pyroxenites up to mafic lavas and volcaniclastics (Figure 1). As with most land at similar latitudes, there is glacial till coverage of the area with variable thickness that can hinder exploration efforts, especially where thickest towards the southern portion of the property.

Gold is hosted in intensely deformed conjugate extensional vein sets with quartz as the primary mineral, along with the all-important Au (Figure 2). There are variable levels of sulphides with common pyrite and arsenopyrite and seen in fewer veins, chalcopyrite, and galena. Sulphides are generally more abundant in the alteration halo surrounding the vein than the veins themselves, but these only tend to extend 10s of cm from the vein boundaries.

Strongly deformed auriferous quartz veins from the Keats discovery, hosted in mudstone.
Figure 2. Strongly deformed auriferous quartz veins from the Keats discovery, hosted in mudstone.

It appears that no significant studies have been done to characterise the alteration associated with veining across the property as a whole, but it has been suggested that a larger scale alteration halo of increased graphite levels could be a useful vector for auriferous veins. In addition to this, problems with mapping major structures is made difficult due to the homogeneity of the host rocks of the property, and therefore targeting has been comprised mainly of magnetic and gravity surveys to delineate structures to drill. This makes the process of finding the deep crustal shear zones harder and thus hinders the discovery of Au-bearing veins because in this deposit type, structural trends are a critical control on mineralisation.

So, what results have they got recently?

We’ve surely all walked around conference floors where juniors proudly cart out their favourite section of core, studded with shiny flakes or green streaks, but it appears New Found could kit out every booth with meter after meter of milky quartz filled with flakey gold chunks everywhere (figure 3). Since February, results from New Found’s 200,000m drill program have been rolling in, with particular emphasis on the Lotto and Keats discoveries in the North of the Queensway property. Standout numbers include 51.3 g/t over 3.2 meters and 53.3 g/t over 3.1 meters at Lotto, announced on March 23rd of this year, with previous results including a nice 224.7 g/t over 2.45 meters. Keats has been in the limelight more recently, when on June 15th, New Found announced an extension of their high grade zone at this discovery to 465 meters down-plunge with results in the late teens and twenties grams per ton. This was complimented by yet more high-grade results up to 683 g/t as announced last week. It’s worth remembering of course that these results do not represent true widths of mineralisation and the nuggety nature of gold in these veins lends itself to highly anomalous results and over-estimation of grades.

Visible gold in core from Keats discovery. Every green circle is a beautiful grain of gold.
Figure 3. Visible gold in core from Keats discovery. Every green circle is a beautiful grain of gold.

The north of Queensway has had a multitude of exploration work (mainly geophysics) carried out since the 70s, and has been drilled before by a handful of previous landowners, but no resource has ever been defined. The question we must ask is why? Is New Found Gold Corp just another example of an “exploration” entity exploring for news releases rather than a resource, by twinning drill holes of previous discoveries? Or are the results a genuine new resource having been discovered in eastern CA?

For a company with no NI43-101 compliant resource, they have a market cap of CA$1.7b, and a fair share price compared to junior non producers of ~12 bucks, which seems good for the insiders who currently hold 26% of allotted shares. The lack of defined ounces however, doesn’t appear to be a problem for serial junior mining investor Eric Sprott, who increased his equity in New Found to 20% earlier this month in a purchase worth CA$6.5m.

The rest of 2021 will see the continuation of the drill program and other grassroots exploration activity to attempt to uncover more at-surface mineralisation as well working towards the all-important resource definition. But so far, the marketing team at New Found have been doing a good job (according to the share price), and hopefully this can be backed up soon with solid numbers.

Dan

All information in the above article is sourced from the New Found Gold Corp website and materials within unless otherwise stated.

Sources:

New Found Gold Corp:

https://newfoundgold.ca/

Queensway technical report:

https://newfoundgold.ca/wp-content/uploads/2020/08/NFGC-Technical-Report.pdf

Eric Sprott investment:

https://finance.yahoo.com/news/eric-sprott-just-bought-1-063259908.html

Cover image: unrelated beautiful Newfoundland! Source: Canada in Morocco, Twitter.